The role of culture in consumers’ price search and behavior has received limited attention in the literature. In the present research, the authors examine how the cultural dimension of power distance belief (PDB)—the extent to which people accept and endorse hierarchy—influences consumers’ price sensitivity. The authors propose that consumers high (vs. low) in PDB are less price sensitive because they have a higher need for closure, which motivates them to “seize and freeze” on a current offer and quickly arrive at the final purchase decision rather than search for a better price. Accordingly, the relationship between PDB and price sensitivity is moderated by variables that alter consumers’ need for closure, such as social density. Six studies (and five more summarized in the Web Appendices) using a variety of operationalizations of the key variables provide robust support for the relationship between PDB and price sensitivity and shed light on the underlying mechanisms and boundary conditions. Theoretical and managerial implications are discussed.
AckermanDavidTellisGerard (2001), “Can Culture Affect Prices? A Cross-Cultural Study of Shopping and Retail Prices,” Journal of Retailing, 77 (1), 57–82.
AlfordBruce L.BiswasAbhijit (2002), “The Effects of Discount Level, Price Consciousness and Sale Proneness on Consumers’ Price Perception and Behavioral Intention,” Journal of Business Research, 55 (9), 775–83.
BaronReuben M.MandelDavid R.AdamsClaire A.GriffenLynne M. (1976), “Effects of Social Density in University Residential Environments,” Journal of Personality and Social Psychology, 34 (3), 434–46.
6.
BiggartNicole WoolseyHamiltonGary G. (1984), “The Power of Obedience,” Administrative Science Quarterly, 29 (4), 540–49.
7.
CarlDaleJavidanMansourGuptaVipin (2004), “Power Distance,” in Culture, Leadership, and Organizations: The Glove Study of 62 Societies, HouseRobert J.HangesPaul J.JavidanMansourDorfmanPeter W.GuptaVipin, eds. Thousand Oaks, CA: SAGE Publications, 513–59.
8.
CarverCharles S. (1989), “How Should Multifaceted Personality Constructs Be Tested? Issues Illustrated By Self-Monitoring, Attributional Style, and Hardiness,” Journal of Personality and Social Psychology, 56 (4), 577–85.
9.
ChoiJong AnKooMinkyungChoiIncheolAuhSeigyoung (2008), “Need for Cognitive Closure and Information Search Strategy,” Psychology & Marketing, 25 (11), 1027–42.
10.
DasDebabrataSrinivasanR.DhankarRaj S. (2011), “Demand for Hybrid Car in Indian Metro Cities,” International Journal of Electric and Hybrid Vehicles, 3 (1), 1–19.
11.
DeGradaEraldoKruglanskiArie W.MannettiLuciaPierroAntonio (1999), “Motivated Cognition and Group Interaction: Need for Closure Affects the Contents and Processes of Collective Negotiations,” Journal of Experimental Social Psychology, 35 (4), 346–65.
12.
DésertMichelLeyensJacques-Philippe (2006), “Social Comparisons Across Cultures I: Gender Stereotypes in High and Low Power Distance Cultures,” in Social Comparison and Social Psychology: Understanding Cognition, Intergroup Relations, and Culture, GuimondS., ed. Cambridge, UK: Cambridge University Press, 303–17.
13.
DisatnikDavidSteinhartYael (2015), “Need for Cognitive Closure, Risk Aversion, Uncertainty Changes, and Their Effects on Investment Decisions,” Journal of Marketing Research, 52 (3), 349–59.
14.
ErdemTülinSwaitJoffreLouviereJordan (2002), “The Impact of Brand Credibility on Consumer Price Sensitivity,” International Journal of Research in Marketing, 19 (1), 1–19.
15.
ErdemTülinSwaitJoffreValenzuelaAna (2006), “Brands as Signals: A Cross-Country Validation Study,” Journal of Marketing, 70 (1), 34–49.
16.
FriesenJustin P.KayAaron C.EibachRichard P.GalinskyAdam D. (2014), “Seeking Structure in Social Organization: Compensatory Control and the Psychological Advantages of Hierarchy,” Journal of Personality and Social Psychology, 106 (4), 590–609.
17.
GaoHuachaoZhangYinlongMittalVikas (2017), “How Does Local–Global Identity Affect Price Sensitivity?” Journal of Marketing, 81 (3), 62–79.
GrewalDhruvMonroeKent B.KrishnanRamayya (1998), “The Effects of Price-Comparison Advertising on Buyers’ Perceptions of Acquisition Value, Transaction Value, and Behavioral Intentions,” Journal of Marketing, 62 (2), 46–59.
20.
HanDaHeeLalwaniAshok K.DuhachekAdam (2017), “Power Distance Belief, Power, and Charitable Giving,” Journal of Consumer Research, 44 (1), 182–95.
HayesAndrew F. (2012), “PROCESS: A Versatile Computational Tool for Observed Variable Mediation, Moderation, and Conditional Process Modeling,” white paper, The Ohio State University, (accessed March 15, 2020), http://www.afhayes.com/public/process2012.pdf.
23.
HofstedeGeert H. (2001), Culture’s Consequences: Comparing Values, Behaviors, Institutions, and Organizations Across Nations. Thousand Oaks, CA: SAGE Publications.
24.
HuiMichael K.BatesonJohn E.G. (1991), “Perceived Control and the Effects of Crowding and Consumer Choice on the Service Experience,” Journal of Consumer Research, 18 (2), 174–84.
25.
KamakuraWagner A.RussellGary J. (1993), “Measuring Brand Value with Scanner Data,” International Journal of Research in Marketing, 10 (1), 9–22.
26.
KardesFrank R.CronleyMaria L.KellarisJames J.PosavacSteven S. (2004), “The Role of Selective Information Processing in Price-Quality Inference,” Journal of Consumer Research, 31 (2), 368–74.
27.
KelleyHarold H. (1955), “Salience of Membership and Resistance to Change of Group-Anchored Attitudes,” Human Relations, 8 (3), 275–89.
28.
KellyJanice R.McGrathJoseph E. (1985), “Effects of Time Limits and Task Types on Task Performance and Interaction of Four-Person Groups,” Journal of Personality and Social Psychology, 49 (2), 395–407.
29.
KooMinkyungShavittSharonLalwaniAshok K.ChinchanachokchaiSydney (2020), “Lost in Translation: The Depleting Consequences of Culturally Mismatched Thinking Styles,” International Journal of Research in Marketing, forthcoming.
30.
KopallePraveen K.LehmannDonald R.FarleyJohn U. (2010), “Consumer Expectations and Culture: The Effect of Belief in Karma in India,” Journal of Consumer Research, 37 (2), 251–63.
31.
KossowskaMałgorzata (2007), “Motivation Towards Closure and Cognitive Processes: An Individual Differences Approach,” Personality and Individual Differences, 43 (8), 2149–58.
32.
KrishnamurthiLakshmanRajSethuraman P. (1991), “An Empirical Analysis of the Relationship Between Brand Loyalty and Consumer Price Elasticity,” Marketing Science, 10 (2), 172–83.
33.
KruglanskiArie W. (2004), The Psychology of Closed Mindedness. New York: Psychology Press.
34.
KruglanskiArie W. (2013), Lay Epistemics and Human Knowledge: Cognitive and Motivational Bases. Berlin: Springer Science & Business Media.
35.
KruglanskiArie W.AtashM. NadirGradaEraldo DeMannettiLuciaPierroAntonioWebsterDonna M. (1997), “Psychological Theory Testing Versus Psychometric Nay-Saying: Comment on Neuberg et al.’s (1997) Critique of the Need for Closure Scale,” Personality Processes and Individual Differences, 73 (5), 1005–16.
36.
KruglanskiArie W.PierroAntonioMannettiLuciaGradaEraldo De (2006), “Groups as Epistemic Providers: Need for Closure and the Unfolding of Group-Centrism,” Psychological Review, 113 (1), 84–100.
37.
KruglanskiArie W.WebsterDonna M. (1991), “Group Members’ Reactions to Opinion Deviates and Conformists at Varying Degrees of Proximity to Decision Deadline and of Environmental Noise,” Journal of Personality and Social Psychology, 61 (2), 212–25.
38.
LalwaniAshok K. (2009), “The Distinct Influence of Cognitive Busyness and Need for Closure on Cultural Differences in Socially Desirable Responding,” Journal of Consumer Research, 36 (2), 305–16.
39.
LalwaniAshok K.ForcumLura (2016), “Does a Dollar Get You a Dollar’s Worth of Merchandise? The Impact of Power Distance Belief on Price-Quality Judgments,” Journal of Consumer Research, 43 (2), 317–33.
40.
LalwaniAshok K.ShavittSharon (2009), “The ‘Me’ I Claim to Be: Cultural Self Construal Elicits Self-Presentational Goal Pursuit,” Journal of Personality and Social Psychology, 97 (1), 88–102.
41.
LalwaniAshok K.ShavittSharon (2013), “You Get What You Pay For? Self-Construal Influences Price-Quality Judgments,” Journal of Consumer Research, 40 (2), 255–67.
42.
LalwaniAshok K.ShavittSharonJohnsonTimothy (2006), “What Is the Relation Between Cultural Orientation and Socially Desirable Responding?” Journal of Personality and Social Psychology, 90 (1), 165–78.
43.
LalwaniAshok K.ShrumL.J.ChiuChi-Yue (2009), “Motivated Response Styles: The Role of Cultural Values, Regulatory Focus, and Self-Consciousness in Socially Desirable Responding,” Journal of Personality and Social Psychology, 96 (4), 870–82.
44.
LalwaniAshok K.WangJessie J. (2019), “How Do Consumers’ Cultural Backgrounds and Values Influence Their Coupon Proneness? A Multi-Method Investigation,” Journal of Consumer Research, 45 (5), 1037–50.
45.
LalwaniAshok K.WangJessie J.SilveraDavid H. (2020), “What Is the Relation Between Culture and Regulatory Mode?” Journal of Business Research, forthcoming.
46.
LeuthesserLanceKohliChiranjeev S.HarichKatrin R. (1995), “Brand Equity: The Halo Effect Measure,” European Journal of Marketing, 29 (4), 57–66.
47.
LichtensteinDonald R.RidgwayNancy M.NetemeyerRichard G. (1993), “Price Perceptions and Consumer Shopping Behavior: A Field Study,” Journal of Marketing Research, 30 (2), 234–45.
MachleitKaren A.ErogluSevgin A.MantelSusan Powell (2000), “Perceived Retail Crowding and Shopping Satisfaction: What Modifies This Relationship?” Journal of Consumer Psychology, 9 (1), 29–42.
50.
MageeJoe C.GalinskyAdam D. (2008), “8 Social Hierarchy: The Self-Reinforcing Nature of Power and Status,” Academy of Management Annals, 2 (1), 351–98.
51.
MelaCarl F.GuptaSunilLehmannDonald R. (1997), “The Long-Term Impact of Promotion and Advertising on Consumer Brand Choice,” Journal of Marketing Research, 34 (2), 248–61.
52.
PahariaNeeruSwaminathanVanitha (2019), “Who Is Wary of User Design? The Role of Power-Distance Beliefs in Preference for User-Designed Products,” Journal of Marketing, 83 (3), 91–107.
53.
ParkHanyongLalwaniAshok K.SilveraDavid H. (2020), “The Impact of Resource Scarcity on Price-Quality Judgments,” Journal of Consumer Research, 46 (6), 1110–24.
54.
PierroAntonioMannettiLuciaGradaEraldo DeLiviStefanoKruglanskiArie W. (2003), “Autocracy Bias in Informal Groups Under Need for Closure,” Personality and Social Psychology Bulletin, 29 (3), 405–17.
RoetsArneHielAlain Van (2007), “Separating Ability from Need: Clarifying the Dimensional Structure of The Need for Closure Scale,” Personality and Social Psychology Bulletin, 33 (2), 266–80.
57.
RoetsArneHielAlain Van (2008), “Why Some Hate to Dilly-Dally and Others Do Not: The Arousal-Invoking Capacity of Decision-Making for Low-and High-Scoring Need for Closure Individuals,” Social Cognition, 26 (3), 333–46.
58.
RoetsArneHielAlain Van (2011), “Item Selection and Validation of a Brief, 15-Item Version of the Need for Closure Scale,” Personality and Individual Differences, 50 (1), 90–94.
59.
SchumpeBirga M.BriziAmbraGiacomantonioMauroPannoAngeloKopetzCatalinaKostaMatilda, et al. (2017), “Need for Cognitive Closure Decreases Risk Taking and Motivates Discounting of Delayed Rewards,” Personality and Individual Differences, 107, 66–71.
60.
SchutFrederik T.GressStefanWasemJuergen (2003), “Consumer Price Sensitivity and Social Health Insurer Choice in Germany and the Netherlands,” International Journal of Health Care Finance and Economics, 3 (2), 117–38.
61.
ShilohShoshanaKorenShellyZakayDan (2001), “Individual Differences in Compensatory Decision-Making Style and Need for Closure as Correlates of Subjective Decision Complexity and Difficulty,” Personality and Individual Differences, 30 (4), 699–710.
62.
SingelisTheodore M. (1994), “The Measurement of Independent and Interdependent Self-Construals,” Personality and Social Psychology Bulletin, 20 (5), 580–91.
SpillerStephen A.FitzsimonsGavan J.LynchJohn G.JrMcClellandGary H. (2013), “Spotlights, Floodlights, and the Magic Number Zero: Simple Effects Tests in Moderated Regression,” Journal of Marketing Research, 50 (2), 277–88.
65.
SternBarbara B.BarakBennyGouldStephen J. (1987), “Sexual Identity Scale: A New Self-Assessment Measure,” Sex Roles, 17 (9/10), 503–19.
66.
TanWillieChongEddie (2003), “Power Distance in Singapore Construction Organizations: Implications for Project Managers,” International Journal of Project Management, 21 (7), 529–36.
67.
TurleyLou W.MillimanRonald E. (2000), “Atmospheric Effects on Shopping Behavior: A Review of the Experimental Evidence,” Journal of Business Research, 49 (2), 193–211.
68.
WakefieldKirk L.InmanJ. Jeffrey (2003), “Situational Price Sensitivity: The Role of Consumption Occasion, Social Context and Income,” Journal of Retailing, 79 (4), 199–212.
69.
WangJessie J.LalwaniAshok K. (2019a), “Cross-Cultural Variables Across 50 States,” unpublished data.
70.
WangJessie J.LalwaniAshok K. (2019b), “The Distinct Influence of Power Distance Perception and Power Distance Values on Customer Satisfaction in Response to Loyalty Programs,” International Journal of Research in Marketing, 36 (4), 580–96.
71.
WangJessie J.TorelliCarlos J.LalwaniAshok K. (2020), “The Interactive Effect of Power Distance Belief and Consumers’ Status on Preference for National (vs. Private-Label) Brands,” Journal of Business Research, 107, 1–12.
72.
WebsterDonna M.KruglanskiArie W. (1994), “Individual Differences in Need for Cognitive Closure,” Journal of Personality and Social Psychology, 67 (6), 1049–62.
73.
WebsterDonna M.RichterLindaKruglanskiArie W. (1996), “On Leaping to Conclusions When Feeling Tired: Mental Fatigue Effects on Impressional Primacy,” Journal of Experimental Social Psychology, 32 (2), 181–95.
74.
WinterichKaren PageZhangYinlong (2014), “Accepting Inequality Deters Responsibility: How Power Distance Decreases Charitable Behavior,” Journal of Consumer Research, 41 (2), 274–93.
75.
YangZhiyongSunSijieLalwaniAshok K.JanakiramanNarayanan (2019), “How Does Consumers’ Local or Global Identity Influence Price-Perceived Quality Associations? The Role of Perceived Quality Variance,” Journal of Marketing, 83 (3), 145–62.
76.
YooBoongheeDonthuNaveenLenartowiczTomasz (2011), “Measuring Hofstede’s Five Dimensions of Cultural Values at the Individual Level: Development and Validation of CVSCALE,” Journal of International Consumer Marketing, 23 (3/4), 193–210.
77.
ZhangShiKardesFrank R.CronleyMaria L. (2002), “Comparative Advertising: Effects of Structural Alignability on Target Brand Evaluations,” Journal of Consumer Psychology, 12 (4), 303–11.
78.
ZhangYinlongWinterichKaren PageMittalVikas (2010), “Power Distance Belief and Impulsive Buying,” Journal of Marketing Research, 47 (5), 945–54.
79.
ZhouZhengNakamotoKent (2001), “Price Perceptions: A Cross-National Study Between American and Chinese Young Consumers,” in Advances in Consumer Research, Vol. 28, GillyMary C.Meyers-LevyJoan, eds. Valdosta, GA: Association for Consumer Research, 161–68.
Supplementary Material
Please find the following supplemental material available below.
For Open Access articles published under a Creative Commons License, all supplemental material carries the same license as the article it is associated with.
For non-Open Access articles published, all supplemental material carries a non-exclusive license, and permission requests for re-use of supplemental material or any part of supplemental material shall be sent directly to the copyright owner as specified in the copyright notice associated with the article.
